- EBITDA of PLN 4.5 billion in 2025 and more than PLN 6.5 billion in 2030
- Maintain the net debt to EBITDA ratio at a safe level
- Increase in installed RES capacity to 1.6 GW in 2025 and to 3.7 GW in 2030
- Reduce emissions to 200 kg CO2/MWh in 2025 and below 160 kg CO2/MWh in 2030
- Implementation of smart metering – 100% smart meters by 2030
- New connections of customers to the district heating network – approx. 450 MWt by 2030
- Maintain high customer service standards – First Time Resolution (FTR) rate > 90% in 2030.
-
2-12
-
2-13
TAURON Group Strategy for the years 2022-2030 with an outlook until 2050 was adopted as of June 22, 2022. The document is a response to the challenges arising from the situation on the market and in the electricity sector, particularly related to the transition of the industry.
The main objective set in the document is to build TAURON Group’s value through modern solutions for customers and climate while maintaining its financial stability. This goal will be implemented based on three priorities:
- 7 GW of installed wind capacity by 2025 and 1.1 GW by 2030,
- 7 GW of installed solar capacity by 2025 and 1.4 GW by 2030,
- participation in offshore wind development with strategic partners and in-house development of up to 1 GW of installed capacity by 2030; further 1.1 GW of capacity after 2030.
TAURON Group’s renewable energy installed capacity growth ambitions by 2030 are shown below
The strategy presents an optimal path of sustainable development that will ensure TAURON Group’s financial stability and growth prospects while taking into account the high volatility of the macro environment and ensuring an integrated approach to environment challenges.
The key areas of the new Strategy are: Distribution, Renewable Energy Sources (RES), District Heating and Customer. The Distribution Line of Business, through continued development and modernization of the grid, will be striving to maintain its position as a segment generating stable, regulated revenue for the Group. The main roles of the RES Line of Business include investing in renewable energy sources and implementing of energy storage technologies. Profitable development of the Heat Line of Business based on a program to transition to low-carbon sources is planned. The role of the Supply Line of Business is to increase customer satisfaction through high quality customer service and improvements of offerings and processes, as well as digitalization and automation. In addition, investments in a circular economy and efficient use of resources are assumed. With respect to the Mining and Generation Lines of Business – government solutions for coal mining and coal-fired power generation are being implemented.
The Group’s new investment projects will be carried out with reference to technical qualification criteria for determining the conditions under which the given economic activity qualifies as making a material contribution to climate change mitigation or adaptation, as well as for determining whether such economic activity does not cause serious damage to any of the other environmental objectives, defined as:
- mitigation of the effects of climate change,
- adaptation to climate change,
- sustainable use and protection of water and marine resources,
- transition to a circular economy,
- pollution prevention and control,
- protection and restoration of biodiversity and ecosystems.
Implementation of Priority #1 Sustainable Operations
The Group's priority is to increase installed capacity in renewable energy while reducing the CO2 emissions.
In 2022, a total of 44 MW of renewable capacity was commissioned (a 30 MW Piotrków wind farm and a 6 MW Majewo wind farm, as well as an 8 MW Choszczno II PV farm).
In addition, the decisions on going ahead with the implementation of RES projects with a total capacity of 224 MW were taken last year. The total installed RES capacity stands at 659 MW in 2022, which corresponds to 42% of the implementation of the RES target for 2025.
TAURON is also preparing to participate in the offshore wind farm projects. In September 2022. TAURON acquired a stake in PGE Baltica 4 sp. z o.o. (Ltd.) from PGE. At the beginning of this year, PGE Baltica was granted a permit to erect and use artificial islands. In April 2022, TAURON applied for permits for the erection or use of artificial islands in the Lawica Odrzana area.
Works were also underway to prepare a comprehensive program to modernize and improve the efficiency of TAURON’s hydroelectric power plants. In addition, the following investment projects were launched in 2022: the construction of a small 2 MW hydroelectric power plant in Rożnów and the installation of a turbine at the Lubachów hydroelectric power plant.
A priority initiative undertaken in 2022 was also the implementation of the timetable for the government’s program leading to the spin-off of coal-fired generation assets from the energy groups and their integration into the National Energy Security Agency (NABE). TAURON conducted activities related to the spin-off of TAURON Wytwarzanie subsidiary from TAURON Group and their transfer to the State Treasury. As part of the implementation of the letter of intent signed with the State Treasury in 2021 regarding the acquisition of 100% of the shares in TAURON Mining subsidiary by the State Treasury, 100% of the Company’s shares were transferred to the State Treasury on December 31, 2022.
With respect to the transition of the district heating towards low- and zero-emission sources, the following projects are being prepared (in the pipeline): the energy transition of ZW Katowice and the construction of a PV farm together with an energy storage facility for the needs of ZW Bielsko-Biała EC1. While the projects at the implementation stage include: the construction of a 140 MWt gas-fired boiler at ZW Katowice for the needs of the district heating market and the construction of a peaking and back-up boiler plant at ZW Bielsko-Biała EC-2.
Among other things, in 2022, the by-product status was obtained for the ash and slag mixtures at TAURON Ciepło's Kamienna Góra Generating Plant and the Central District Heating Plants in Olkusz and Zawiercie, while also new products were developed through certification and industry feedback.
The Strategy identifies conducting works on innovative solutions to support the Group’s transition as one of the directions of its further growth. TAURON is working on the development and implementation of energy storage technologies through, among others, the implementation of projects including energy storage integrated with RES, storage aimed at improving the quality parameters of electricity and stabilizing grid operation, as well as the development of a portfolio of products in the field of energy storage and other projects carried out as part of its R&D activities. In line with the Strategy, preparations have been commenced for the construction of the Rożnów II pumped storage power plant.
Projects related to the production and use of green hydrogen and the production of ammonia from green hydrogen are also underway.
In preparation for the construction of a state-of-the-art nuclear source, a small modular reactor (SMR) R&D project was launched in 2022, and a Letter of Intent was signed for the cooperation between TAURON and KGHM regarding this technology.
Implementation of Priority #2 Growth based on the largest customer base
Ensuring the security of energy supply and the quality of electricity and heat, as basic services, is the key strategic direction pursued by the Distribution and Heat Lines of Business.
The most important actions taken in the Distribution Line of Business affecting the improvement of quality parameters include: increasing the degree of grid automation (in 2022, the number of remotely controlled switches per 100 km of MV overhead line had increased to 13), upgrading the existing networks to insulated overhead lines and cable lines (at the end of 2022, more than 40% of MV lines had been cabled), adapting the distribution grid to increased power flows in both directions (in 2022, micro-installations with the capacity of 908 MW had been connected to the grid), improving the diagnostics of the operating status of the MV and LV networks through the use of smart substation metering technology and digitalization of the metering databases (nearly 17% of Customers are equipped with remote readout meters; more than 87% of the transformer substations have remote readout meters installed).
With respect to the district heating market development, the Ligota Project – the expansion of the Katowice South district heating market and the Low Emission Elimination Program are being implemented.
Implementation of Priority #3 An organization that keeps up with change
TAURON entered into a new syndicated loan agreement worth PLN 4 billion in 2022, the proceeds from which can be used, among other things, to finance the Group’s capital expenditures, including RES. In addition, the Group took advantage of the aid funds available. The total amount of financing obtained for the investment projects carried out in 2022 stands at more than PLN 446 million.
With respect to human capital management, the most important issue in 2022 was the effective conducting of the social dialogue with the workforce aimed at preparing for changes in the employment structure and the evolution of the organization in connection with the spin-off of the generation, mining and security lines of business assets outside the structure of TAURON Group.
446
PLN million
The total value of funding obtained for investments implemented in 2022.